This book is one of a number of best sellers written by David Bach, but this one is definitely my favourite. It really is one of those penny dropping moments when it comes to getting even the worst savers to save.
David is a Financial Planner in the US and as you can imagine has come across all sorts of different clients as part of his job. But he actually attributes the idea of ‘The Automatic Millionaire‘ to one couple in particular who became millionaires through good old fashion saving. The most amazing part about their story was that they never earned more than $40,000 a year during their life.
The secret is that it’s not about how much you earn but how much you save and that you automate your saving.
In the book David describes a number of ways you can ensure that you ‘pay yourself first’ before your money gets spent paying other people.
How would you like it if at least for one hour of every working day, you were actually working for yourself and the money earned for that hour would go towards your savings?
Well this is the mindset you need to get into if you are ever going to truly grow your wealth and I’m pleased to say there is some fantastic new tech that can make the automation of your savings even easier.
How about an app that rounds up every time you spend and deposits the difference in an investment account? Or an app that automatically knows how much you can save and moves the money into a savings account for you? Find out more information in my article on ‘2 Apps to help you save without budgeting or noticing‘
What I love about this book is that it gets straight to the point, it is short and really easy to read. I thoroughly recommend it if you want to start properly saving and changing your future.
Other insights in the book include:
- “The time value of money – Invest now rather than later.” (p.48)
- “There’s a better way to get rich than budgeting.” (p.61)
- “The pay yourself first formula.” (p.77)
- “When the going gets tough, the tough have cash.” (p.144)
- “How one day of shopping can take thirteen years to pay off.” (p.198)
- “Automatic Millionaire Blueprint.” (p.235)
What makes this book different to other financial planning books is that it throws the budget out the window. David makes the valid point that once you have put your savings on autopilot you can sit back, relax and enjoy spending the rest of your money without feeling guilty. Safe in the knowledge that your wealth is growing behind the scenes.
What daily spending could you cut out each day? Join the conversation here.
Stock market linked investments and any income from them, can fall as well as rise and is not guaranteed. Any figures quoted are for illustrative purposes and should not be taken as a forecast or guarantee. Past performance should not be seen as an indication of future returns and clients may get back less than they have invested.